Re:Bolt Financial's loans come due
by JumpCrisscross on Thursday May 26, 2022 @02:43PM
(#31521976)
> What conflict of interest?
Issuer is the lender is the employer. This is a mess of conflicts.
> company tried to do something beneficial for its employees, although perhaps it was misguided
I agree. (Though it ignores the stupidly simple, entirely common alternative: cut the loan crap and just give them the money.)
> was a cashless loan, that was only 50% recourse, so the only risk is that you may have to pay back half of what you bought the stock at if it ends up worthless
For that 50%, itβs identical to a margin loan. We regulate those because lending against magic numbers that go up is a consistent failure mode in capital markets.
Issuer is the lender is the employer. This is a mess of conflicts.
> company tried to do something beneficial for its employees, although perhaps it was misguided
I agree. (Though it ignores the stupidly simple, entirely common alternative: cut the loan crap and just give them the money.)
> was a cashless loan, that was only 50% recourse, so the only risk is that you may have to pay back half of what you bought the stock at if it ends up worthless
For that 50%, itβs identical to a margin loan. We regulate those because lending against magic numbers that go up is a consistent failure mode in capital markets.